Bosch targets Pacifica for $495m

Global manufacturing giant Bosch Group has made a $495 million takeover offer for Australian brake maker Pacifica Group.

18 October 2006By Isabelle Oderberg

Global manufacturing giant Bosch Group has made a $495 million takeover offer for Pacifica Group Ltd, providing the Australian car brake maker can steer clear of any more profit warnings.

Bosch has unveiled an off-market offer of $1.92 a share for a total deal valued at $495 million, comprising $260.51 million plus the assumption of debt.

In August the Melbourne-based company lowered its forecast for annual net profit after significant items to the low to mid-$20 million range, from the mid-$30 million range.

Bosch's offer is conditional on a minimum acceptance of 50 per cent and Pacifica not releasing another downgrade to its guidance before the end of the offer period, to be given in the bidder's statement within two weeks.

"The offer will be made directly to shareholders, but there was some communication made to the managing director of Pacifica prior to the bid being made," a source familiar with the situation told AAP.

Pacifica told shareholders that they should take no action on the offer at this time, adding that it was first informed about the bid early on Wednesday.

"Pacifica will keep its shareholders fully informed of further developments and will provide a formal recommendation to shareholders in relation to Bosch's offer in ample time for them to make an informed decision as to whether they should accept the offer," it said.

Pacifica shares ended up 12 cents or 6.3 per cent at $2.04 after hitting a day high of $2.10.

The company's shares had plunged by as much as 21 per cent in July, after the car parts maker rejected a $2.40 per share bid in a deal worth $326 million.

The bidder was protected by a confidentiality agreement, but market speculation about the predator's identity included Bosch and Siemens VDO.

Bosch said the price under the current offer represented a 22 per cent premium to Pacifica's volume weighted average share price of $1.57 since late August when it downgraded its earnings outlook.

"Pacifica is a key supplier for Bosch, so it makes strategic sense to enhance the relationship between the two organisations," Bosch board member and chairman of the automotive group Dr Bernd Bohr said.

Bosch is a manufacturer of automotive and industrial technology, consumer goods and building technology.